PremiumMUMBAI: Indian equity markets are likely to be volatile on Monday, with the start of the March quarter earnings season amid nervousness around a complete lockdown in few states like Maharashtra. Trends in SGX Nifty suggest a weak opening for Indian benchmark indices.
On Friday, the Sensex closed the day at 49,591.32, down 154.89 points, or 0.31%, while Nifty was at 14,834.85, down 38.95 points, or 0.26%. Banks, financials, realty and auto sectors closed in red.
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Asian shares started cautiously on Monday as investors wait to see if US earnings can justify sky-high valuations, while bond markets could be tested by what should be very strong readings for US inflation and retail sales this week.
MSCI's broadest index of Asia-Pacific shares outside Japan was off 0.05% in slow early trade. Tokyo's Nikkei edged up 0.1%, while South Korean stocks rose 0.2%. Reverberations could be felt beyond China as over a third of the stock is held by US investors, and given the stock making up more than 8% of the MSCI EM index.
Over the weekend, US Federal Reserve Chair Jerome Powell said the economy was about to start growing much more quickly, though the coronavirus remained a threat.
Back home, India's second largest IT firm Infosys Ltd on Sunday said its board will meet on 14 April to consider buyback of shares. The company will also consider its March quarter earnings and final dividend.
Results of IT majors like TCS, Infosys and Wipro will be the focus this week. Expectations are high from the IT companies on the back of higher demand for digitization, large deals and a healthy order pipeline.
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Premium Premium Amazon.com Inc. is embarking on a massive India expansion plan, including a series of tie-ups with regional retail chains, to ensure that a legal setback in the case with Future Group does not upset its long-term plans for the country, according to a Mint report.
The Centre on Sunday prohibited exports of Remdesivir injection and Remdesivir Active Pharmaceutical Ingredients (API), anticipating an increase in demand for the drug used in the treatment of covid-19 patients amid a surge in coronavirus infections in the country.
Data out this week are expected to show U.S. inflation jumped in March, while retail sales is seen surging perhaps even with a double-digit gain.
The pullback in yields was enough to see the dollar come off the boil last week. It was last trading at 92.208 against a basket of currencies, down from a peak of 93.439. It was flat on the yen at 109.73, and short of its March peak of 110.96. The euro was holding at $1.1897 and above its recent trough of $1.1702.
Gold prices were idling at $1,740 an ounce, having failed to sustain a top of $1,758 last week.
Oil prices fell around 2% last week as production increases and renewed covid-19 lockdowns in some countries offset optimism about a recovery in fuel demand.
Brent was quoted up 33 cents on Monday at $63.28 a barrel, while U.S. crude added 25 cents to $59.57.
(Reuters contributed to the story.)
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